Facilities and Administrative Cost (F&A/Indirect/Overhead) Waivers  

Georgia Tech goes through an extremely rigorous process every two years to calculate the sum total of the current costs associated with research.  These costs, often referred to as Facilities and Administrative (F&A), indirect, or overhead costs must be covered for every research project.  In order to streamline the payment of these costs, Georgia Tech negotiates specific rates with the federal government that apply to the vast majority of the projects sponsored by a federal agency.   

• The research capped rate applies to federal grants and contracts except Department of Defense (DoD) contracts (it does apply to DoD grants).  Because the amount that we can recover for administrative costs is capped, this rate does not fully cover Georgia Tech’s costs for federal research projects.  Therefore, Tech must invest the difference on each project.   

• The research uncapped rate is the only rate under which the sponsor fully covers the cost of the research.  This rate is applied to DoD contracts as well as projects with non-profit and industry sponsors, to ensure that we do not subsidize industry work with taxpayer dollars.  

Myths and Truths about F&A: 

Download COGR Waiver Presentation slides

The Council on Governmental Relations (COGR), released a report in 2019 entitled “Excellence in Research: The Funding Model, F&A Reimbursement, and Why the System Works.”  The slides here, also prepared by COGR, are excerpted from that report. 

F&A is not simple and there are many myths that circulate around it.  Here, COGR identifies truths in response to myths such as: 

• F&A costs are like a tax 

• F&A received is funneled back to individual researchers and their departments for discretionary use 

• F&A includes actual costs plus a profit 

• Over half of the funding goes to pay F&A costs 

• F&A reimbursements only support the institution’s infrastructure, providing little benefit to scientific research 

Process for requesting a reduced F&A Rate: 

Every sponsored project has an F&A rate that is documented in the eRouting system.  Any requests for unusual or reduced rates should be initiated in the system.  The requests are then filtered to the appropriate parties as follows: 

• Determination of the correct rate for a project, such as the Other Sponsored Activities rate or the Off-Campus rate, is handled by the Office of Sponsored Programs (OSP).  These rates should be selected by name when the proposal is entered into eRouting. 

• OSP generally approves the use of a reduced rate for domestic non-profit or federal government entities if that entity has a published rate that is consistently applied to all funding recipients.   

• Be sure to attach or link to the Request for Proposals (RFP) in eRouting. 

• If the rate is not documented in the RFP it must be published on a website or other publicly available document.  Include the location of the policy in the eRouting entry so that the rate may be confirmed and approved as quickly as possible. 

• Correspondence directed solely to Georgia Tech from a sponsor is not sufficient proof of a standard policy that is consistently applied. 

• If the PI is requesting use of a rate other than the appropriate rate for the project, this request is entered as a waiver and is routed to the Office of the Executive Vice President for Research (EVPR) for review. 

• Any request for a reduced F&A rate should include a thorough explanation.  Upload or link to all relevant documentation within eRouting in order to expedite the review process. 

The following elements do not have any bearing on the institute’s ability to issue an F&A waiver:  

• Size of the proposal budget  

• Significance of the work  

• Potential for future funding  

• Authorization of a waiver for similar projects in previous years  

• The PI’s preference for allocating budget to direct costs rather than indirect costs  

• The sponsor’s policies on F&A rates (unless they are a federal or domestic non-profit   

sponsor, in which case an F&A waiver is not necessary)  

Please see the relevant policies: 

• 2.3.6.4 Waiver of F&A Reimbursement 

• 2.3.6.3 Policy on Reduced F&A and General Exception 

Fringe Waivers  

There is no such thing as a fringe waiver.  Fringe is a cost that must be paid at the time the work is completed.  Typically, if a sponsor will not cover fringe, it is paid by the unit.  Should the unit be unable to cover the fringe, it should initiate a cost share request.  

Looking for something else?

• Go to Researcher Resources Index
• Have a question? Contact: evproffice@gatech.edu